Faith-based and nonprofit construction is different. Just as commercial, residential, and infrastructure construction projects have different requirements, a construction project in the nonprofit sector has different requirements for a successful project. There are different risk tolerances and different legal considerations. A construction project is often one of the biggest investments a nonprofit will undertake — so preparation is essential for success considering these differences.

What is the IRS Form 990 and what does your organization need to know about it? What follows is a brief explanation of a specific section of the Form 990 and its relevance to nonprofits.1

In addition to maintaining a gift acceptance policy, a nonprofit should also maintain a charitable gift receipt template that it fills out and gives to a donor once it accepts a gift (both cash and in-kind gifts). Donations to tax-exempt organizations should only be deducted on a donor’s federal income tax return if the donor receives a receipt from a tax-exempt organization that serves as evidence that the donor contributed to a tax-exempt organization.

All nonprofits should adopt certain corporate policies, including a gift acceptance policy. A gift acceptance policy describes the types of gifts that a nonprofit is, and is not, willing to accept – a nonprofit may not have use for an obsolete computer, a vehicle that does not start,1 or a gift with too many strings attached. Some potential gifts might even cause a nonprofit more harm than the gift is worth (e.g., the expensive maintenance of an old boat). Such a policy notifies a nonprofit’s members, board of directors, officers, employees, and volunteers of the gifts that the nonprofit will accept when potential donors inquire about making donations, thus preventing the nonprofit from receiving undesired gifts.

When acting as a director or officer, there are some situations when one can be subject to personal liability for one’s actions. If uninsured, one lawsuit can have a huge impact on a nonprofit organization. Luckily, Directors and Officers insurance (“D&O insurance”) allows for a way to mitigate the damage in scenarios like this.